In partnership with the tech house “Criptonomia”, the companies have developed a solution that will change the future of B2B relationships
RHI Magnesita, the world market and technology leader in refractories, and Gerdau, the largest steel producer in Brazil, are joining forces and taking an important step in their business relationship. Today, the companies announce the go-live of a joint project using blockchain technology. The project, called Refrac Chain, is unprecedented in the global steel segment and exclusively designed to measure performance contracts between RHI Magnesita and Gerdau. All data and transactions, which were previously tracked manually, will be recorded in blockchain and financial calculations and measurements will be made by a dedicated program.
The two companies started their collaboration because information security is a crucial asset that is increasingly gaining ground in relationships between businesses. In addition, the use of distributed technology has a fundamental impact on companies conducting large volumes of transactions. Stefan Borgas, CEO RHI Magnesita, comments: “Digitalization and Industry 4.0 are radically changing the way we work together. This impacts all areas of the business – from sales to production. Blockchain will leave no stone unturned in our industry. This key technology not only brings more security and reliability, it redefines the partnership between companies and creates opportunities to trust each other in a way that was not possible before.” The joint project allows for the traceability of processes and information exchange between RHI Magnesita and Gerdau.
The blockchain platform began operating this year exclusively at a Gerdau site in Minas Gerais, Brazil. The intention is that from there, they can expand the solution to other company operations. For Vinicius Moura, General Supply Manager at Gerdau, the project is aligned with the company’s objective of generating value for the entire steel network. “We seek solutions that meet the challenges of the business, in partnership with our suppliers in order to guarantee the operational excellence of our units. This initiative brings reliability, speed and agility to the process, and reflects the journey of digital transformation that Gerdau has been going through in recent years,” says Moura.
Led by RHI Magnesita and Gerdau, the project helps to guarantee a continually high performance of the refractory products supplied to the steel industry. Tasks that were previously performed manually using spreadsheet calculations will now be done by the platform. This will considerably reduce repetitive work, speeding up the process while at the same time increasing transparency and security of contractual information.
Gustavo Franco, CSO RHI Magnesita, explains: “Blockchain technology has enormous potential also for our industry. Establishing a secure and holistic data network with Gerdau will enhance even more our historical partnership. By driving workflow efficiencies and automated data transactions, reliable insights are provided to both parties, increasing agility in decision-making and confidence in the operations of our contracts.”
According to the specialists in charge of the project at Criptonomia, Antonio Hoffert and Gleisson de Assis, this is an unprecedented use of blockchain in the steel industry. The new software combines technical, legal, and commercial workflows in one interface. Other segments that are already using blockchain in their operations are logistics and transportation, supplies, agriculture, automotive, and energy, among others. “It builds a common ground of trust, with validation steps by different representants from both companies and offers space for storing proof in the form of images, documents, text, videos, and audio, thus reducing transaction risks and making the process highly auditable,” says Hoffert. Transparency, security, and data accuracy are some of the key benefits of using the platform. “It is also a replacement for the current way of making contracts, which is a positive step towards decentralization. The use of the system sets up digital signatures that can be monitored and validated by the parties throughout all stages of the process and prevent occasional problems from snowballing into a major ordeal,” concludes the expert.
According to Antonio Hoffert, Refrac Chain is already the largest decentralized application in the Brazilian-based industry. With the expansion of the project in the next five years, the goal is to become the largest industrial blockchain application in the world.
About RHI Magnesita
RHI Magnesita is the leading global supplier of high-grade refractory products, systems and solutions which are critical for high-temperature processes exceeding 1,200°C in a wide range of industries, including steel, cement, non-ferrous metals and glass. Our purpose is to master heat, enabling global industries to build sustainable modern life. With a vertically integrated value chain, from raw materials to refractory products and full performance-based solutions, RHI Magnesita serves customers around the world, with around 12,000 employees in 28 main production sites and more than 70 sales offices. RHI Magnesita intends to build on its leadership in revenue, scale, product portfolio and diversified geographic presence to expand further in high growth markets.
The Group maintains a premium listing on the Official list of the London Stock Exchange (symbol: RHIM) and is a constituent of the FTSE 250 index, with a secondary listing on the Vienna Stock Exchange (Wiener Börse). For more information please visit: www.rhimagnesita.com